Grain News: March 5, 2019 – China Grain Traders Await Lower Tariffs
The market has grown tired of the rhetoric from Washington that tries to build up ideas that China will be a buyer of U.S. corn, ethanol, DDGs, and/or soybeans. The U.S. has requested China lower the current 70% tariff on U.S. ethanol to 15%. No response has been received. Traders want to see something concrete on the books. Hoping that China will lower tariffs on U.S. goods and the passing of the March 2nd tariff increase deadline produced an early round of buying yesterday, but as the buying stopped the markets fell through the mid-day trade. Although positive comments from both sides of the trade battle are pointing toward a potential resolution, the funds and speculators continue to be heavy sellers on all rallies. March should provide plenty of market volatility with Friday’s monthly USDA report, a potential trade deal on March 27th and then the Prospective Acreage Report on the 29th.
Corn inched forward yesterday, helped by some technical buying and spillover strength from soybeans. March futures gained a penny to $3.65, with May futures up 1.75 cents to $3.74. European Union corn imports are up 45% year-over-year after topping 653 million bushels as of March 3.
Soybean were higher yesterday on renewed U.S.-China trade optimism. March futures added 4 cents to $9.03, with May futures up 4.5 cents to $9.16.
Wheat picked up where they left off last month, as declines continue into early March on persistent concerns over large U.S. supplies and sluggish exports. March Chicago SRW futures dropped 7.25 cents to $4.46.
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